Correlation Between Boston Properties and Corporate Office
Can any of the company-specific risk be diversified away by investing in both Boston Properties and Corporate Office at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Boston Properties and Corporate Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Properties and Corporate Office Properties, you can compare the effects of market volatilities on Boston Properties and Corporate Office and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Boston Properties with a short position of Corporate Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Properties and Corporate Office.
Diversification Opportunities for Boston Properties and Corporate Office
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Boston and Corporate is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Boston Properties and Corporate Office Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corporate Office Pro and Boston Properties is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Boston Properties are associated (or correlated) with Corporate Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corporate Office Pro has no effect on the direction of Boston Properties i.e., Boston Properties and Corporate Office go up and down completely randomly.
Pair Corralation between Boston Properties and Corporate Office
If you would invest 6,190 in Boston Properties on August 27, 2024 and sell it today you would earn a total of 1,876 from holding Boston Properties or generate 30.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.53% |
| Values | Daily Returns |
Boston Properties vs. Corporate Office Properties
Performance |
| Timeline |
| Boston Properties |
| Corporate Office Pro |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Boston Properties and Corporate Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Properties and Corporate Office
The main advantage of trading using opposite Boston Properties and Corporate Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Properties position performs unexpectedly, Corporate Office can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Corporate Office will offset losses from the drop in Corporate Office's long position.| Boston Properties vs. SL Green Realty | Boston Properties vs. Douglas Emmett | Boston Properties vs. Kilroy Realty Corp | Boston Properties vs. Alexandria Real Estate |
| Corporate Office vs. Highwoods Properties | Corporate Office vs. Piedmont Office Realty | Corporate Office vs. Douglas Emmett | Corporate Office vs. Kilroy Realty Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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